Day Trading

Day trading means opening and closing positions within a single session. Everything is converted back to cash by the close, and profit comes from short-term price movement.

It watches order flow and charts rather than company value. Judging over minutes or hours makes earnings and business prospects largely irrelevant; volume, the shape of the order book and instant reactions to news matter instead.

Costs eat heavily into results. Trading several times a day accumulates commissions, spreads and taxes. A return that looks respectable often turns negative once these are deducted.

Studies across several countries find that only a tiny minority of individuals profit consistently from day trading. Most lose, and the finding that heavier trading produces worse outcomes recurs repeatedly.

It suits people with day jobs especially poorly, since it demands watching screens all session and punishes slow decisions. If you try it, strictly limiting the amount you can afford to lose is the minimum condition.